Stage Stores to close 90 stores to boost productivity

20 August 2015 (Last Updated August 20th, 2015 18:30)

Department store chain Stage Stores is planning to shut down 90 underperforming stores as part of its multi-year plan to increase productivity.

Department store chain Stage Stores is planning to shut down 90 underperforming stores as part of its multi-year plan to increase productivity.

The stores being closed represent 4% of its total sales.

Stage Stores currently operates 850 specialty department stores in 40 states and a direct-to-consumer channel under the Bealls, Goody's, Palais Royal, Peebles and Stage nameplates.

Commenting on the closure, Stage Stores president and CEO Michael Glazer said: "The closure of stores should enhance our capital efficiency, deliver higher productivity and be accretive to earnings."

The closure comes as the retailer announces financial results for the second quarter ended 1 August.

Stage Stores' sales increased by 0.9% to $380.9m, when compared to the same period a year before.

The retailer's comparable sales increased by 0.8% during the same period.

"We were challenged by the impact of a weaker peso and economic softness in parts of Texas, Louisiana, Oklahoma, and New Mexico.

"Our earnings decline over the prior year was driven by a decrease in merchandise margin as we accelerated markdowns on seasonal categories. On a comparable store basis, our quarter ending inventory, excluding cosmetics, was down by 2%," Glazer added.

The company plans to open three new stores and close 27 store locations in fiscal 2015.